Al-Rajhi Bank and Samba Financial Group rose on Tuesday after Credit Suisse raised its price targets for the Saudi lenders, helping the kingdom's bourse end higher. Most other Middle East bourses also advanced, mirroring international gains, while oil rallied, boosting sentiment in the world's top crude-exporting region.
Rajhi climbed 2.2 percent and Samba rose 0.9 percent as Credit Suisse gave both banks outperform ratings, helping the index climb 1 percent to trim its losses to 5.1 percent since late-April's 18-month high. "We are still very much correlated to international markets and so the Saudi market has enjoyed a short-term bounce, but there's no fundamental news," said Saleh al-Onazi, vice-president of principal investment at Swicorp in Riyadh. Global stocks edged higher on cautious optimism that progress is being made on the week-old euro zone rescue plan.
Al Khaliji Bank rose 2.8 percent after the lender announced a June 1 board meeting to discuss a possible merger with International Bank of Qatar. Qatar National Bank rose 0.9 percent and Commercial Bank of Qatar added 1.1 percent after rebounding from technical support levels, helping Doha's index climb 0.8 percent to 7,254 points.
Gulf Finance House lost 6.9 percent, a day after analysts voiced worries about the firm's lack of asset sales that were promised to creditors in return for rolling over loans, weighing on Kuwait's index, which fell for a second day in three. Gulf Bank and Ahli United Bank climbed 3.5 and 1.9 percent respectively, bucking the downward trend. "The current global instability fuelled by the uncertainty in Europe and the negative downward spiral of the euro has spilled over to Kuwait and hit investor sentiment," said Jasem al-Zeraei, head of institutional sales at NBK Capital. Commercial International Bank's, seen as a defensive stock in times of volatility, rose 2.8 percent, helping Egypt's index stem losses. On Wednesday, CIB reported stronger-than-expected first quarter profit.
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